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Editor’s Note: This week we present an abbreviated This Week in Washington. This will also be our last This Week in Washington until the New Year.

The lame duck wraps

This week, the Senate put the final wrap on the lame-duck session. Saturday the Senate approved the CROmnibus spending package that had been approved in the House last week–but not before a delay led by conservative Senator Ted Cruz (R-TX). The delay actually turned out to be a gift to Democrats–giving Harry Reid and the outgoing majority time to approve 69 executive branch nominees, including a controversial Surgeon General nominee.

Tuesday night the Senate easily passed a deal to extend more than 50 tax breaks that expired at the end of 2013. The bill passed after last month's fight between Reid and the White House, which scuttled a more ambitious deal.

Reid had negotiated a deal with Republicans in November to extend the tax credits for at least two years, with several tax breaks favored by the business community earning permanent extensions. The bill lacked, however, a permanent extension of the Earned Income Tax Credit and the Child Tax Credit, which the White House had pushed for, leaving both to expire in 2017.

As a result, the White House issued a veto threat. The president's veto threat ended bipartisan conversation about the deal and forced members back to the drawing board.

What emerged was a significantly smaller, retroactive one-year tax extender bill that the House passed before leaving town last week and the Senate passed in a 76-16 vote Tuesday evening. The one-year extension will give clarity to Americans as they enter tax-filing season early next year. The bill extends all 50 tax credits that expired last year through December 31, allowing individuals and businesses to claim them on their 2014 filings with the Internal Revenue Service. But, proponents of a bigger deal have pointed out that the deal leaves those tax credits in limbo for 2015.

It wasn't all positive in the closing days of the lame duck.

Compromise legislation re-authorizing the Federal Terrorism Risk Insurance Act (TRIA) was scuttled after Republican Sen. Tom Coburn refused to lift his hold on the bill. Coburn, and other fiscally minded Republicans, objected to renewing the program, believing that the free market will step in to insure individuals and businesses from future terrorist attacks without the federal backstop program. Democrats also mounted strong objections over the last-minute inclusion of a provision reforming the Dodd-Frank Wall Street law by House Republicans.

The failure of the TRIA compromise legislation - which had been crafted by Sen. Chuck Schumer (D-NY) and Rep. Jeb Hensarling (R-TX) - in the Senate was somewhat surprising after the House passed the same legislation by an overwhelmingly bipartisan 417-7 vote.

The TRIA program will now expire at the end of December.

Dramatic shift in the US-Cuba relations

After more than 50 years, US-Cuban relations are about to dramatically change. The change was prompted by the case of Alan Gross, the American contractor who had been imprisoned in Cuba since 2009. Gross was released to the United States by the Cuban government on Wednesday. The so-called "humanitarian release" coincided with an exchange of three Cubans convicted of espionage in Miami for one unnamed U.S. intelligence asset.

The announcement of Gross' release comes with much broader-reaching news: the U.S. is preparing a shift in its relationship with Cuba and is set to begin talks to normalize diplomatic relations. The U.S., which has had a tight trade embargo on Cuba since 1961, is now set to announce a loosening of economic and travel restrictions. The Obama administration is also looking to set up an embassy in the Cuban capital of Havana "in the coming months," the White House says.

Restrictions on certain kinds of travel will be greatly loosened, but limitations will not be lifted altogether. Any travel that falls into 12 approved categories can go ahead fairly easily, according to a senior administration official. Those categories include family visits, official government business, and trips for journalistic, educational and research purposes. The exemptions also include humanitarian travel, among a few other categories.

Tourism—that is, any visit that does not fall into the 12 approved categories—remains prohibited. "We're authorizing as much travel as we possibly can" within the limits of a Congressional travel ban, the senior official said. The wider travel ban can only be lifted by Congress.

And yes: the loosening includes an opening on Cuban cigars. Per the White House: "Licensed U.S. travelers to Cuba will be authorized to import $400 worth of goods from Cuba, of which no more than $100 can consist of tobacco products and alcohol combined."

Cuba also released 53 of its own prisoners. The U.S. flagged these inmates to the Cuban government as political prisoners.

The upsides of this new policy to Cuba's struggling economy are obvious, but several American industries are poised to benefit enormously from the change as well. In particular, the American banking, construction and agricultural industries - among others - could reap the economic benefits of a new, more relaxed policy towards Cuba. Just how much these and other industries will be able to do business with Cuba will depend on yet-to-be written regulations that will be promulgated by the Department of Treasury and the Commerce Department.

Enzi to Chair Budget Committee

The weeks-long battle to chair the powerful Senate Budget Committee ended Wednesday with a peaceful accord, allowing Sen. Mike Enzi, the most senior Republican on the panel, to take the gavel in January.

Many believed that Sen. Jeff Sessions of Alabama, who has served as ranking member since 2011, would take over the Budget Committee in 2015. But Enzi, who holds a slight edge in seniority on the panel over Sessions, announced in November that he would challenge Sessions for the gavel shortly after Republicans won the majority.

Enzi said in a press release Wednesday that he and Sessions had come to an agreement to allow the Wyoming lawmaker to take over the committee next year.

Sessions' loss of the top slot on the committee could have a major impact on the immigration debate, as Republicans work to find an appropriate rebuttal to President Obama's executive action. Sessions is one of the leading opponents of the administration's actions on immigration and has carried the issue throughout his congressional career. Enzi is no more a fan of the administration's actions, but many on Capitol Hill saw the issue as the key focus of a Sessions-led Budget Committee.

The agreement between Enzi and Sessions will avoid an all-out fight among Budget Committee members in January. The choice of a chairman must be ratified by members of the committee and the whole Republican Conference when members return to Washington in January, but it's unlikely that the handshake deal between Enzi and Sessions will be overturned.

NHL going carbon neutral

The National Hockey League has committed to becoming the first major sports league to go carbon neutral.

Under a partnership with the energy services firm Constellation, the league will work with its 30 teams to slash its carbon emissions and purchase carbon offsets for all its emissions during the current 2014-2015 season. The league is estimated to emit 530,000 metric tons of carbon this season through energy use at its arenas and offices, nearly 2 million miles of team air travel, consumption of goods, and other league operations.

"Our sport was born on frozen ponds and relies on winter weather," said NHL Commissioner Gary Bettman. "Everyone who loves our game will benefit by taking an active role in preserving the environment and the roots of the game."

Constellation CEO Joe Nigro said the company would offer energy-efficiency analyses to NHL teams and provide Renewable Energy Certificates to offset emissions and promote wind farms, clean biomass, and solar power. The effort will also include emissions from games already played this season, which began in October.

The NHL has been ahead of most sports leagues on sustainability, using a NHL Green program launched in 2010 to promote recycling and cleaner energy at its arenas. In July, the league released a sustainability report, the first by a major sports league, which detailed its carbon footprint and identified how teams would cut energy use in future seasons.

Political bits                        

House

Arizona 2nd Congressional District:  A recount confirmed that retired Air Force Col. Martha McSally (R-AZ), who narrowly lost a 2012 challenge to Rep. Ron Barber (D-AZ), ousted the Democrat by a margin of 167 votes.

Potential presidential contenders

Republicans:

Former Governor Jeb Bush (R-FL) announced that he would begin actively exploring a run for the Republican nomination for president.

Former Sen. Rick Santorum (R-PA) announced that he is likely to once again seek the GOP nomination for president.  Santorum unsuccessfully sought the nomination in 2012.

Florida Sen. Marco Rubio (R-FL) made it clear this week that a run by former Florida Governor Jeb Bush would not preclude a run by Rubio in 2016.

Former Hewlett-Packard CEO Carly Fiorina (R-CA) is apparently hiring staffers in preparation for a potential 2016 run.  Fiorina has never held elective office but raised her political profile in an unsuccessful run for the Senate against Barbara Boxer in 2010.

Sen. Rand Paul (R-KY), who is expected to seek the Republican nomination for President, broke ranks with most Republicans and announced he supported President Obama's new policy towards Cuba.

Democrats:

Former Senator and Secretary of State Hillary Clinton (D-NY), the Democratic front-runner, announced that she backed President Obama's deal with Cuba that begins to normalize relationships between the two countries.

Liberal and progressive leaders are actively pushing for Sen. Elizabeth Warren (D-MA) to consider a run for the Democratic nomination in 2016.

A LOOK AHEAD

The House and Senate are in Recess Next Week

WASHINGTON BY THE NUMBERS

$125 billion - size of the “tax cut” equivalent bestowed on middle-class Americans by falling gas prices, according to a Goldman Sachs estimate.

$800 - Price for which Apple cofounder Ron Wayne sold his 10-percent stake in the fledgling company in 1976

THEY SAID WHAT?

“God is not that much of a Democrat for Ted Cruz to get nominated.” -- Former Rep. Barney Frank, D-Mass., on the 2016 presidential race (Reuters)

WASHINGTON HUMOR                        

"Congress goes on recess starting tomorrow night. By the way, that's all you need to know about Congress. They get recess. A bunch of middle-aged adults get three weeks off to play kickball?" – Jimmy Kimmel

 

 

 Steven C. LaTourette, President | 202.559.2600

McDonald Hopkins Government Strategies LLC
101 Constitution Avenue NW, Suite 600 East, Washington, D.C. 20001 

www.mcdonaldhopkinsgs.com

IMPORTANT NOTICE:

Although McDonald Hopkins Government Strategies LLC is owned by the law firm McDonald Hopkins LLC, McDonald Hopkins Government Strategies is not a law firm and does not provide legal services. Accordingly, the retention of McDonald Hopkins Government Strategies does not create a client-lawyer relationship and the protections of the client-lawyer relationship, such as attorney-client privilege and the ethics rules pertaining to conduct by lawyers, do not apply.

 

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